Employment law

LEGAL UPDATE

By Martin Edwards, Mace & Jones, Liverpool

Annual leave

Hill v Chapell [2003] IRLR 19

An employee resigned, having taken 15 days' paid leave out of a total annual entitlement to 20 days' leave.

She had taken five days more than she was entitled to pro-rata.

She was not paid salary for several weeks and claimed unauthorised deductions from wages and breach of contract.

A tribunal's award in her favour gave credit to the employer for the five days' excess holiday taken, under common law principles and on the ground that it amounted to an 'overpayment of wages' in terms of section 14(1)(a) of the Employment Rights Act 1996.

The Employment Appeal Tribunal (EAT) held that the chairman was wrong to give credit for the excess holidays taken.

Where a worker's employment terminates during the course of a leave year and, at the date of termination, the employee has taken proportionately more leave in that leave year than that to which there is an entitlement, the employer cannot recover the excess holiday pay unless a 'relevant agreement' under regulation 14(4) of the Working Time Regulations 1998 has permitted this recovery.

This was not a case of 'overpayment' of holiday pay and there was no relevant agreement.

Thus there was no basis for giving credit for the extra five days' holiday pay.

List Design Group Ltd v Douglas & others [2003]

IRLR 14

The key question in this case was whether the right to pay in lieu of annual leave can be regarded as 'wages' for the purposes of section 13 of the Employment Rights Act 1996, which prohibits unauthorised deductions from wages.

This matters because the time limit for a claim under the Working Time Regulations 1998 is three months from the date on which it is alleged that the payment should have been made.

Furthermore, the 1998 regulations do not permit untaken leave entitlement to be carried forward from one leave year to the next.

However, the time limit for complaining of an unauthorised deduction from wages which is part of a series is three months from the date of the last unauthorised deduction in the series.

The EAT agreed with the tribunal that, even though the employee's claims for holiday pay were 'out of time' under the Working Time Regulations 1998, the claims could be brought under the Employment Rights Act 1996.

Although the regulations came into force subsequent to the Act, and specifically relate to holiday pay, they do not implicitly sweep away express provisions of 'a major Act of Parliament' which relates to holiday pay in equally specific terms.

Mr Justice Bell stated: 'The provisions of the Act and the regulations are not necessarily contradictory.

It is not difficult to envisage scenarios where a claim will either be in time or out of time under both sets of provisions.'

Race discrimination

Bradford Hospitals NHS Trust v Al-Shabib [2003] IRLR 4

The EAT overruled a tribunal's decision that an applicant of Iraqi origin was less favourably treated on the ground of race when his employers withdrew his membership of their gym after he had broken certain rules.

To sustain a complaint of discrimination, the complainant must show that some other person was or would have been treated differently by the employer in the same or similar circumstances.

On the facts of the case, there was no basis to draw an inference of different treatment.

The tribunal had failed to distinguish between 'reasonableness' and less favourable treatment.

The tribunal was also wrong to find that, although the applicant was 'at times difficult to control' and 'given to using emotive language', it was unreasonable for the manager to expect him to conduct himself differently because 'he does not behave in what one might describe as a conventional Anglo-Saxon way'.

The EAT said that, while it may sometimes be legitimate for a tribunal to take into account differences in behaviour which reflect racial and cultural differences, it is wrong to make findings based on the existence of such differences unless there is some evidential basis for them.

For a tribunal simply to assume that a particular ethnic group has a specific characteristic is fundamentally wrong, even if the assumption is made 'for benign purposes'.

The tribunal should have asked (but did not ask) whether the applicant's manager would have adopted the same approach in the case of any employee who behaved discourteously and used inflammatory language.

Finally, the tribunal was also wrong to find that the applicant had been victimised in circumstances in which he had not raised the issue in his originating application.

The chairman had failed to raise the issue of victimisation during the course of the hearing and he did not invite any amendment to the complaint.

As a result, the employers did not know until they received the tribunal's decision that the tribunal was even considering the possibility of a finding of victimisation.

The tribunal had acted contrary to natural justice.

Thomas & another v Robinson [2003] IRLR 7

The EAT held that a tribunal was wrong to find that a black employee was racially discriminated against by a single racist remark made by a fellow junior employee without considering whether she suffered some detriment as a result.

The tribunal was also wrong to prevent the employers from cross-examining the applicant on the subject, on the basis that all racial abuse is detrimental treatment.

According to the EAT, if the treatment in question is race-specific, there is no need for an applicant to show that a person of different race would have been treated differently.

But that is not the end of the matter because under section 4(2) of the Race Relations Act 1976, the employee must show that the employer has 'subjected him to any other detriment'.

A single act of verbal racial harassment is enough to found a complaint, but does not necessarily amount to harassment.

'Harassment' involves two elements.

The first is targeting of the person being harassed.

The second is the causing of distress to the target.

A tribunal considering whether an employee has been discriminated against by the use of racist language should consider both whether the language has been used and whether the employee has suffered detriment as a result.

If the answer to both questions is yes, then it can be said that the employee has been racially harassed.

In very many (but not all) cases, the second element will be very easy for the applicant to establish.

Apprenticeship

Whitely v Marton Electrical Ltd (2003) The Times, 2 January

The EAT held that a person engaged by an employer under a standard form model apprenticeship pact was an apprentice and not an employee.

This was the case even if the pact required him to comply with the employer's terms and conditions of employment for the duration of his training plan.

Accordingly, he could not be dismissed until the completion of his training.